Brace Yourself Mayer, Saving Yahoo Won't Be Easy: Analysts

It's Marissa Mayer's first day on the job at Yahoo and there's no shortage of opinion about her challenges.

Mayer has won over her fair share of supporters, including the company's board members and activist investor Dan Loeb, who is known for his outspoken criticism of the company's past CEOs, but the reality is, she still has to prove she has what it takes to save Yahoo, analysts told CNBC Tuesday.

"I think Yahoo has a chance," Paul Meeks, an equity analyst for Windsor Asset Management, said on CNBC's "Squawk Box." "It will be very tough. I think it would be even tougher for Christ himself to come there and turn around that company."

Establishing an Identity

The Internet pioneer has a laundry list of challenges, including a stagnant stock price, leadership challenges and an identity crisis.

Along with a revolving door in the C-Suite, the company has struggled for several years to clearly identify itself as a media company, an advertising company or a product company.

"It's been a company in limbo for the last few years. They've tried to become a media company, but I don't really think they had a clear vision of what a media company was or what kind of media company they were," Claus Mortensen, principal of emerging technologies research of IDC Asia Pacific, told CNBC. "And obviously, other areas that they used to be strong in, like search, well the train has left the station, they're not really on it anymore."

The 37-year-old Mayer, a 13-year veteran of Google, is known for her involvement with Google's search, gmail and Google news features. Considering her engineering background, it's widely speculated she will to introduce new products to Yahoo.

'What kind of product would stop the kind of slow bleeding away of consumers to Yahoo's site? I don't have any ideas. Hopefully, Marissa has some ideas right off the top," Mark Mahaney, an Internet analyst at Citigroup, told "Squawk Box."

Eric Jackson of Ironfire Capital said he thinks she will be more product focused as well.

"She's an engineer, she's a techie, she going to bring more of a products focus," Jackson said on CNBC's "Halftime Report." "There's going to be more home-grown Yahoo products that are going to be successful under her watch."

Mayer's plans for Yahoo, however, still remain ambiguous, although she did tell the Financial Times on Monday that she will include "innovating in some of the verticals like finance, sports, video and messenger," while also "being relevant to consumers in their everyday lives — email, search, the homepage and now mobile."

Will Mayer Be Able to Lead the Company?

Another uncertainty about Mayer's appointment is whether or not she has the leadership experience in management to run such a big organization, Mahaney said.

"She's going to have to prove herself as CEO of a very large company," he said. "There are a couple of major assets that are part of Yahoo. Asia's stake in Yahoo Japan, her ability to help negotiate those stakes in those deals is far from proven."

Yahoo sold a large stake in Alibaba, China's e-commerce company, earlier this year, which is expected to bring in about $7 billion. But the company is still negotiating a deal with Yahoo Japan.

Ross Levinsohn, the interim CEO who led the company between Scott Thompson's departure and Mayer's appointment, was widely speculated to be appointed as chief.

Levinsohn helped close the deal with Alibaba and an advertising partnership deal with Facebook, moves that better positioned the company and may have proved he was more qualified than Mayer, Meeks said.

"He showed some leadership in closing that deal with Facebook. He showed some leadership in closing that deal with Alibaba. I thought it was his job to keep," Meeks said.

Despite Mayer's star status at Google as one of the top engineers, Meeks said he is not enthusiastic about her appointment.

"I was a little bit surprised by the choice. Obviously, this is someone who is a senior at Google and had been one of the earlier employees," Meeks said. "However, it seems to me that her career, no offense to her, had been a bit on the slide since Larry Page came in, in April of 2011 as a CEO."

Rethinking the Ad Business

But maybe it will be Mayer's experience at Google that will give Yahoo a renewed life, especially in the advertising business, something that is core to their success, said Mortensen.

"If they can at least regain some share in display advertising, that's a make or break for the company," Mortensen said.

But in regards to advertising, "Yahoo's fallen way behind in the space," said Ken Sena of Evercore Partners. But Mayer's tech background may help the company retool how it goes about advertising.

"In terms of how advertisers buy, increasingly they're not buying it through Yahoo, they're buying it through other platforms like from Google and then they're getting Yahoo's inventory through that," Sena said.

With Mayer's tech background, she may be able to increase the efficiency of the Yahoo's ad platform and add optimization tools that would entice advertisers.

Last month, Yahoo hired former Admeld CEO and Google executive Michael Barrett, who also will likely be assisting in reforming the company's advertising business.

"Bringing in someone like Michael Barrett or Marissa Mayer, you have people who can really shift through those ad assets and decide what assets can they keep and what assets can they start to parse out," Sena said.

Recruiting Talent

Part of why Yahoo may have lost ground in advertising is because it didn't have the necessary talent to turn the business around. Mayer will be key to helping the company snag some of the most innovative people for new projects, Mortensen said.

"The problem now is brain drain the last few years and it's only gotten worse lately, and Marissa Mayer will probably be in a position to reverse that and start attracting talent and develop talent that Yahoo really badly needs," Mortenson said.

Mayer herself has invested in various startups including uBeam, a company focusing on wireless chargers; Square, a payment company that utilizes mobile devices; Minted, a social commerce company; and Brit, a media technology company.

But new talent is just one aspect of what Yahoo needs to renew itself, and Mayer's appointment is just the first step in a string of other changes that are sure follow.

"Change is necessary. The stock's valuation implied no growth, but that's accurate. There hasn't been any growth in free-cash flow in almost five years," Mahaney said. "So something dramatic needed to be done. It's impossible to describe this as anything but dramatic."